The key to unlocking increased sales growth in Europe
GROWTH CHALLENGES SOLVED WITH BUSINESS DEVELOPMENT
For a venture capital backed high growth technology organisation, operating in a fiercely competitive market with little in the way of product differentiation and a pressure to scale in Europe, strategic Business Development provided a competitive advantage. Crucially it allowed the salesforce to engage senior stakeholders earlier to secure higher value deals and offset competitive threats. This resulted in client confidence to develop future pipeline and allowed sales to focus on closing existing deals.
A Driver for Change
As a recognised top three vendor within its sector, this US headquartered software provider secured additional investment to fund international expansion, particularly within Western Europe. However a number of issues stymied their growth plans.
Product awareness was low or non-existent in Europe so the challenge was to educate the market and quickly. Scaling by increasing Field Sales headcount alone was not an option, as it was an expensive as well as a slow process. The issue was exacerbated further with an intensive 12 – 18 month sales cycle and a need to engage multiple stakeholders in each account putting additional bandwidth pressure on resources.
Given the competitive nature of the market and only limited product and cost differentiation across vendors, it was crucial to engage prospects early with a value based commercial proposition as opposed to feature/function price driven approach. Volume-based traditional Demand Generation leads were unlikely to create the genuinely winnable opportunities that the business needed to scale and to achieve its aggressive growth objectives in Europe.
Strategic Business Development?
The European Managing Director recognised the need for a dedicated Business Development resource, which would not only provide the sales team with access to advanced sales skills to allow them to engage with C-Suite stakeholders more often, but it would also advise them on the European market and in particular, the sectors which represented the greatest opportunity for growth.
To drill down on this point; one major challenge for the client was in the way that they licensed; charging a fee per transaction run through the software with no upfront costs. For their customers it facilitated implementation of the software on a small scale, usually in one country or business unit, but it was crucial for them that after winning the initial deal, they expanded as rapidly as possible into other regions and divisions to maximise the transaction volumes.
Clarify invested time with the client to understand the factors that affected the speed at which their customers expanded the use of the software. One of the key findings was the seniority of the sponsors. In the instances with the fastest expansion, a senior stakeholder such as the CFO had seen value and – after completion of a pilot – had mandated adoption throughout the business.
In order to develop the capabilities to sell at a more senior level, the client had invested in Challenger Selling and wanted to apply its principles throughout the customer engagement process. From a messaging perspective this involved re-working the value proposition to focus on the financial value created for clients. As well as developing insight-led approaches to challenge the status quo, encouraging prospects to assess their existing capabilities in a number of areas.
Traditional Demand Generation lacks the essential skills needed for this type of conversation. However a strategic Business Development function engages multiple entry points and utilises advanced sales skills to engage in consultative, business strategy-led conversations with key stakeholders. Business Development focuses on identifying and exploring the known business issues that exist within the prospect’s organisation as well as bringing unconsidered needs to their attention. It then has close integration back into the account team to secure one-to-one meetings with the senior line-of-business stakeholders who own these problems.
The two main barriers this client faced from a sales perspective were firstly how to educate prospects on the true value that they could receive through using the software. Particularly for organisations that had yet to invest in this area, where there was a real danger that an opportunity would fizzle out into a ‘non decision’. And secondly, for those prospects that did move forward into an active buying cycle, how to avoid it becoming a price driven race to the end.
Clarify worked with the client to implement a sales engagement process that allowed them to more effectively mitigate these challenges by developing a stronger compelling need to act and helping to open and maintain relationships with stakeholders who are interested in value rather than price. With the lack of product and price differentiation in the market, one of the biggest opportunities for them to stand out from competitors was through deploying a distinctive and more customer-value focused go-to-market model.
As a result of the outsourced Business Development programme, the European business is now growing ahead of quota, with 18 opportunities delivered per quarter, exceeding the initial target of 15*. To date three significant deals have closed with one initial opportunity for £500K increased to £1.5million as a result of Clarify’s account development strategy.
More importantly, Clarify is helping to shift the mindset and educate the market on the client’s business and this is reflected in the number and quantity of qualified first stage conversations taking place with prospects. The business has been able to push further through the sales cycle without increasing its sales headcount.
To quote the European Managing Director
“Clarify quickly integrated and now operates as part of our internal sales team. It has identified where the business opportunities will be in 2020 and in which sectors we are more likely to win business. With Clarify’s focus on the market and accessing net new accounts, we are confident that our sales pipeline is optimised and this allows the sales team to focus on their strengths and close the deals in play.”
Business Development as a Strategic Asset
Employing strategic Business Development is proven to increase sales productivity and deliver consistent highly qualified, early stage pipeline opportunities. It improves win rates and brings predictability to the sales process which is exactly what a high growth business requires when it is establishing itself in a new market or a new territory.
Business Development brings the niche skills required to be successful in building pipeline, particularly in accessing the right individuals. It effectively maps out and profiles target organisations as well as opening a relationship and an opportunity in an account where there isn’t an active buying cycle. This environment allows the client sales team to focus on what they excel at – closing existing deals – secure in the knowledge that the pipeline is optimised to scale.
* NB a Business Development programme is designed to scale so the ROI will continue to increase along with revenue, new logo opportunities and closed deals.